'Harry Potter'-themed Whimsic Alley and Warner Bros. settle lawsuit

Whimsic Alley, the Miracle Mile shop that sells "Harry Potter" merchandise and was sued by Warner Bros. for trademark infringement, has reached a settlement with the studio that will allow the store to remain open, owner Stanley Goldin told The Times in an email.

In March, Warner Bros., the distributor of the "Harry Potter" movies and since 1998 the owner of the bulk of the "Potter" trademarks, targeted the shop with a lawsuit filed in U.S. District Court in Los Angeles that some fans feared would force the store to close.

The studio alleged that Whimsic Alley's wares and services -- which include wizard costumes, wands and a Hogwarts-style "Great Hall" that can be rented out for parties -- infringed on the studio's "Potter" trademarks and trade dress.

Goldin said that Whimsic Alley would not shutter but instead "make some changes that I can't elaborate on because of confidentiality.

"However, I feel the changes will only strengthen us," Goldin said.

Publicly available legal filings show that the case was dismissed Nov. 21 after the parties agreed to a settlement that is subject to a permanent injunction barring Whimsic Alley from displaying any "Harry Potter" trademarks and other "confusingly similar" marks in the shop or on its website, selling unlicensed "Potter" wares, and offering "Potter"-themed services such as day camps or parties at the Great Hall.

But the injunction allows the store to continue selling licensed "Harry Potter" merchandise -- which it had long carried alongside unofficial wares that were reminiscent of clothing and other objects from the boy wizard's universe.

Goldin said the shop would "continue carrying some wizard wares that are not 'Harry Potter'-related."

The studio had argued that by offering unlicensed products that competed with official "Potter" merchandise, the store was "likely to cause confusion, mistake and deception among prospective purchasers."

A trial had been set for January. In addition to seeking to stop Whimsic Alley from selling allegedly infringing goods, the studio sought unspecified monetary damages.

Warner Bros. did not immediately respond to a request seeking comment.

The studio, which released eight "Harry Potter" films that grossed more than $7.7 billion in theaters worldwide, is gearing up to launch a new movie series from "Potter" author J.K. Rowling, who will write the first installment's screenplay. The new franchise is based on a short volume from the "Potter" canon -- 2001's "Fantastic Beasts and Where to Find Them."

Goldin said in a statement that his shop received "an outpouring of support, concern and encouragement" from fans after The Times published a story about the legal case in October. He said customers who were planning "parties, weddings, bar mitzvahs and other events" at Whimsic Alley's Great Hall worried the shop would have to close its doors.

"Whimsic Alley is here to stay and will continue to be the top fandom oriented store in Los Angeles," he said.

The popular store is known for an interior design that features elements of the "Potter" world and sales clerks who sport costumes evocative of the film series.

Goldin said the shop will expand its scope by carrying more products associated with other fantasy and science fiction franchises, such as television shows "Game of Thrones" and "Doctor Who," Goldin said.

Goldin opened Whimsic Alley in Santa Monica in 2004, hiring a Hollywood set designer to create an interior reminiscent of a fictional London shopping district, catering to wizards, that is a key part of the "Potter" world. Goldin moved the store to its Miracle Mile location in 2010.

Goldin and Warner Bros. had another legal tussle nearly a decade ago when the studio filed a lawsuit against him that contained similar allegations to those in the March lawsuit. That 2004 case ended in a settlement in which Goldin agreed to stop using or displaying items that featured "Harry Potter" trademarks -- or other "confusingly similar" products -- in connection with the sale of merchandise, according to the studio's recent lawsuit.

"They can say, 'You did this once before, and now you are crossing the line once again,'" attorney Allen Grodsky, who specializes in intellectual property litigation and reviewed the case for The Times, said in October. "I understand why Warner Bros. is upset."